CareDx, Inc. (CDNA)

Priced as of 2026-09-11 — market data goes stale within days; treat this as a starting point, not a current quote.

This Sum-of-the-Parts (SOTP — a valuation that prices each business line separately and adds them up, rather than valuing the whole company at once) analysis puts CareDx's central fair value at **$100.37 per share**, about **99% above** the current $50.43 price. The swing versus the prior run is almost entirely methodological, and two changes do nearly all the work. First, the prior valuation priced the Transplant Testing & Patient Solutions Strategic Business Unit (SBU — a distinct business line inside a company) on Quest Diagnostics' 2.78x Enterprise Value to Revenue (EV/Revenue) multiple, the single lowest comparable company (comp) in its set, while its own notes said CareDx grows two to three times faster than Quest. The revised Rule A forbids anchoring on the floor of a defensible range; the midpoint of the Quest-to-Natera range is 9.91x. Second, the revised Rule C requires the freshest disclosed financial base: CareDx's FY2026 guidance implies $448M of revenue for that SBU, not the $332M FY2025 figure the prior run used. Those two changes compound. The honest caveat is large and is not hidden here: at 9.91x revenue, the central case implies roughly 70x Enterprise Value to Earnings Before Interest, Taxes, Depreciation and Amortisation (EV/EBITDA) against company-wide FY2026 adjusted EBITDA guidance, versus 13.76x for Quest and 25.50x for Veracyte — the only two comps in the set that earn positive EBITDA. That cross-check is what the conservative end of the band is built on, and the price sits **inside** the band, not below it. Per the Decision Framework, a price inside the band caps conviction at Moderate and means this method does not resolve the name; two further caps apply independently (the largest SOTP component rests on a Stage 4 borderline call, and on a comp-choice judgment). Momentum reads **Already Run** — the stock sits at 92% of its 52-week range and its EV/Sales multiple is roughly 1.7x its own five-year average — so part of the gap may already be reflected.

Fair-value band

Rather than a single point estimate, this valuation reports a range: every discretionary judgment call set to its defensible low end, its midpoint, and its high end.

Price sits inside the band — the method does not resolve this name. The decision below comes from the central estimate, but the honest read is that it depends on assumptions this analysis could not settle.

Portfolio at a glance

Key assumptions & swing factors

• Rule A midpoint anchoring on the Transplant SBU drives the entire result. That SBU is 88.7% of Total Fair Enterprise Value, and moving its multiple from Quest Diagnostics' 2.70x floor to the 9.91x midpoint of the Quest-to-Natera range is worth roughly $60 per share on its own. Two alternative midpoint constructions (Veracyte-to-Natera midpoint at 11.13x; growth-interpolation between Veracyte and Natera) both landed higher, so 9.91x is the conservative member of the midpoint-anchored family.
• The EV/EBITDA cross-check argues against the central estimate and is not hidden. At 9.91x revenue the central Total Fair EV of $5.01B implies roughly 70x company-wide EV/EBITDA against FY2026 adjusted EBITDA guidance of $72M (midpoint), versus 13.76x for Quest Diagnostics and 25.50x for Veracyte, the only two comps with positive EBITDA. This tension is carried into the conservative case (Quest 2.70x, implying 19.3x EV/EBITDA) rather than resolved by lowering the central multiple.
• Rule B — discount once, not twice: neither mechanism was applied, because neither SBU carries a weak Job Audit verdict. Transplant Testing & Patient Solutions is a Safe Cow (Fortress 21/25, Strong 20/25, Stable source) and Specialty Oncology is a Live Bet (Strong 17/25, Stable source). No lower comp set was selected on Job Audit grounds and no haircut was applied to either chosen multiple.
• Rule C — freshest base: FY2026 guidance replaces the prior run's FY2025 actuals. The Transplant SBU base rises from $332M to $448M, derived as core-business-ex-Lab-Products guidance of $472M minus Specialty Oncology's $24M. Specialty Oncology uses the $48M annualised run-rate of its H2 2026 guidance rather than the $24M half-year figure, since applying an annual multiple to a half-year figure would halve the answer for a mechanical reason.
• The price sits INSIDE the Rule D band ($32.65 conservative / $100.37 central / $166.75 generous), 54% above the conservative end and 70% below the generous end. Per the Decision Framework this means the method does not resolve CareDx, and conviction is capped at Moderate. The assumption that would narrow the band is whether the transplant franchise deserves a multiple set by its own 17-28% growth or by its current ~15% adjusted EBITDA margin and the ~8.3% growth of its market — segment-level EBITDA disclosure would settle it, and CareDx does not provide it.
• Specialty Oncology (NavDx) remains a flagged placeholder, not a researched NavDx-specific multiple — Stage 4 could not place it on either BCG axis. It contributes 11.3% of Total Fair Enterprise Value, below the ~20% threshold at which the whole SOTP would become a range for that reason alone.
• Stage 4 borderline calls inherited: (1) transplant market growth clusters at 7.5%-8.3% CAGR across three tightly-scoped sources, just under the 10% threshold, while a fourth lower-confidence source cites 15.47% which would flip the SBU from Cash Cow to Star and push toward the generous end; (2) the high-share leg of the Cash Cow call is rank-based, with no analyst firm publishing a numeric share split between CareDx and Natera.
• Momentum is a genuine counterweight. The stock sits at 92% of its 52-week range ($13.23-$53.67), has risen 72.8% since July 2, 2026, has roughly tripled over twelve months against Quest Diagnostics' +29.34%, and trades at 4.88x EV/Sales versus its own five-year average of 2.89x. Analyst consensus target is $54.14, only 7% above the current price. A +99% gap that exists because of a comp-anchoring convention, in a stock that has run this hard, supports a Moderate-conviction BUY and nothing stronger.
• Not deducted, flagged: up to $100M of contingent consideration on the Naveris acquisition. Its fair value is not disclosed in the sources reviewed and the bridge in valuation_rules.md makes no provision for earn-outs. If paid in full it would reduce fair value by roughly $1.87 per share in every case in the band.

Portfolio-level tensions

• Naveris funding dependency: the Transplant Testing Cash Cow funded the Specialty Oncology acquisition ($160M upfront + up to $100M contingent) entirely from its own cash flow, but Specialty Oncology cannot yet be BCG-confirmed as a Star or Question Mark.
• Shared Natera rivalry: Natera's Prospera competes head-to-head with AlloSure in Transplant Testing (a $44.9M jury verdict against Natera), while Natera's Signatera holds >90% share of the broader oncology MRD market NavDx sits adjacent to — one competitor's execution is a portfolio-wide concentration risk.
• Rule 6 correlated jobs: the physician ordering job (21/25 Fortress) and the patient/digital-solutions job (20/25 Strong) within Transplant Testing & Patient Solutions ride the identical underlying source — their separate meters should be read as correlated, not independent.
• Overstated cross-sell: Specialty Oncology's Key Partners narrative frames CareDx's transplant centers as a cross-sell asset for NavDx, but the two SBUs' customer segments don't actually overlap and sales teams remain unmerged — should be treated skeptically, not as an established synergy.
• Parallel, unconsolidated lab infrastructure: both SBUs run separate CLIA-certified labs with no disclosed consolidation plan — a potential cost-synergy opportunity and an integration risk at once.